Brian Stoddart

Any American presidential election reverberates around global policy corners but, for India, the 2012 contest carries unusual significance. With its economy slowing, national government under severe pressure, and competition with China over ‘new Asian power’ status sharpening, India has a strong stake in the November result. Superficially, India could be contented. A late 2011 Congressional Research Service report shows two-way trade totalling approximately $US50 billion.

The US is India’s largest direct investment partner at over $16 billion, and one of its largest trading partners. As India’s economic growth flourished, American interest and investment soared. The highpoint was America’s 2008-9 agreement on nuclear development and trade – as for Australia a few years later, that was the cost of doing business with India.

Obama met with Prime Minister Manmohan Singh in November 2009 in what was seen as a further sign of a strong emerging relationship between the two countries. EPA/Shawn Thew

Leighton G. Luke

India and Mauritius are yet to agree on changes to the double taxation arrangements that have seen New Delhi miss out on tax revenues of up to US$600 million annually.

Background

Concerned at the amount of tax revenue lost to Mauritius-based companies under existing arrangements, India is continuing to seek a renegotiated taxation treaty with the island state. Indian officials have estimated that the “Mauritius route” results in the loss of some US$600 million in tax revenues each year.

Sandy Gordon

On September the 8th, India and Pakistan agreed to liberalise their visa arrangements. The deal came during three day talks between Pakistani foreign minister Khar and Indian counterpart Krishna at Islamabad. Under the deal eight categories of visa will be liberalised, including the provision of visa on entry at the land border for the elderly and young, and most importantly, the provision of multiple entry and multiple city visas for business people with turnovers of over Rs 3 million annually.

The latter is particularly significant in view of recent trade developments. These include Islamabad’s decision to grant most favoured nation (MFN) status to India – which had been granted by India to Pakistan in 1996. Pakistan has promised by December this year to grant MFN to India by eliminating the system allowing only stipulated items to be traded in favour of a small ‘negative’ list covering defence-related and other sensitive items. India has also liberalised its regime by agreeing to remove yarn and textiles from its ‘sensitive’ list and allowing Pakistani businesses to set up in India.